ANDERSON — Concerns about rising energy costs and the coming of data centers that guzzle water and electricity are driving legislation in the Indiana General Assembly.
According to data from the Citizens Action Coalition, Hoosiers’ electric bills have risen 17.5% within the past year.
That coupled with Gov. Mike Braun telling the Indianapolis Investment Forum in May that the state doesn’t have enough energy to meet the evergrowing demand for electricity has prompted concern from legislators.
During the 2025 session, which was completed early this year, the General Assembly passed legislation to encourage the use of small modular nuclear reactors, to the dismay of some clean energy advocates.
Representatives of the Indiana Conservative Alliance for Energy said they support the development of SMRs, but they noted that state officials shouldn’t overlook incentivizing alternatives such as wind and solar power. “We view current available advanced energy: solar, wind, battery storage as lowhanging fruit,” said Hunter Jones, executive director of the alliance. “The goal is to get electrons on the grid.” Many communities throughout the state have opposed the siting of wind and solar projects. Roughly 80% of Indiana’s 92 Indiana counties have moratoriums on such projects.
Jones feels the opposition is unwarranted — solar and wind energy would reduce costs in the immediate future, whereas SMRs could take decades of development before economic benefits would arise.
“Education and messaging in those communities (that oppose solar and wind projects) could be a lot better,” Jones said. “A lot of the advancements that have been made in the past decade are not the same solar and wind residents have in their mind.”
He also said the state should look into allowing residents to generate power with plug-in balcony solar panels.
In March, the Utah State Legislature passed a law allowing residents to use such devices to generate up to 1.2 kilowatts, enough to power blenders and other light-use appliances, without obtaining a permit or connecting with a utility. These panels cost less than $2,000.
Sam Carpenter, executive director of the Hoosier Environmental Council, said the panels would pay for themselves within 4-5 years.
Indiana Sen. J.D. Ford, D-Indianapolis, has decided to follow a similar path with Senate Bill 74, which had its first reading Monday.
Plug-in solar panels don’t “need a requirement for utility interconnection, and that’s why they require legislation. The legislation also includes safety standards,” Carpenter said.
State officials could also change how electric bills are calculated.
The Indiana General Assembly’s Utilities Committee recently discussed the possibility of establishing a performance-based electricity pay rate, where a utility would be compensated at a rate based on the reliability and efficiency of the utility and its equipment.
Rates are traditionally calculated based on the utility’s cost of service — in other words, rates are increased or decreased to cover the cost of service.
Jones believes the idea has promise, though Carpenter said there are still too many variables that are unknown.
DATA CENTER CONCERNS
In several communities, Hoosiers have recently voiced concerns about water and electricity usage of data centers. According to the website Data Center Map, 80 data centers are either already built or in development in Indiana.
Most of data centers’ electricity usage is split between operating and cooling massive IT servers.
According to the Hoosier Environmental Council, Amazon’s Northwest Indiana data center project is expected to require 2.2 gigawatts of electricity at peak operating times, enough to power about half of the state’s households.
Sen. J.D. Ford, D-Indianapolis, has authored Senate Bill 79, which would require developers to disclose the amount of water and electricity a data center is expected to use before a permit can be issued.
The bill would also require data centers to report quarterly use of water and electricity to a working group that would include representatives of electricity suppliers, the data center industry, and representatives of the regional transmission organization in Indiana.
The working group would attempt to forecast the data center industry’s future in the state and submit its findings to the director of the state’s legislative services agency no later than Oct. 26, 2026.
A large data center could use at least five million gallons of water per day, the equivalent needed to serve a population of 50,000 people.
The River Ridge Commerce Center in Jeffersonville will house a Meta data center. Its power plant could treat up to 12 million gallons of water a day, the organization’s chief director, Wendy Dant Chesser, said in a Jeffersonville News and Tribune article.
The Meta data center is expected to be operational in 2026.
Such high volumes of need could strain existing water utilities, so Rep. Alex Burton, D-Evansville, is hoping fellow legislators will take action to protect Indiana’s water resources by passing House Bill 1043.
The legislation would require that developers obtain a water consumption permit from the Indiana Department of Natural Resources before establishing a data center.
Burton is also concerned about the quality of the water discharged by data centers.
“The goal is to make sure our water remains safe, drinkable. ... It’s important that if water is to leave the data center, that it’s safe,” he said.
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